EXHIBIT 10.1
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WAIVER AND SECOND AMENDMENT TO CREDIT AGREEMENT
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THIS WAIVER AND SECOND AMENDMENT TO CREDIT AGREEMENT ("Second Amendment")
is entered into as of May 9, 2003, by and among MEDSOURCE TECHNOLOGIES, LLC (the
"Borrower"), MEDSOURCE TECHNOLOGIES, INC. (the "Parent"), those Domestic
Subsidiaries of the Borrower as have executed this Second Amendment below (the
"Subsidiary Guarantors"), WACHOVIA BANK, NATIONAL ASSOCIATION, as Administrative
Agent (the "Administrative Agent"), and those banks and other financial
institutions as have executed this Second Amendment below (the "Lenders").
BACKGROUND
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A. The Borrower, the Parent, the Subsidiary Guarantors, the Lenders, the
Administrative Agent, U.S. Bank, National Association, as Syndication Agent, and
Harris Trust and Savings Bank, as Documentation Agent, are parties to a Credit
Agreement dated as of April 2, 2002, as amended by a First Amendment to Credit
Agreement and Consent dated as of August 26, 2002 (as amended, modified and/or
extended, the "Credit Agreement"), pursuant to which the Lenders have extended
certain credit facilities to the Borrower. Capitalized terms contained herein
and not otherwise defined shall have the meanings ascribed to them in the Credit
Agreement.
B. An Event of Default has occurred under the Credit Agreement as a result
of the Borrower's failure to maintain a Fixed Charge Coverage Ratio of greater
than or equal to 1.50:1.00 as of March 31, 2003, in accordance with Section
5.9(b) of the Credit Agreement (the "Specified Default").
C. The Credit Parties have requested, and the Administrative Agent and the
Lenders have agreed, upon the conditions set forth in this Second Amendment, to
waive the Specified Default.
D. The Credit Parties, the Administrative Agent and the Lenders also have
agreed, upon the conditions set forth in this Second Amendment, to amend the
Credit Agreement in the manner herein provided.
NOW, THEREFORE, in consideration of the promises and mutual agreements
herein contained and incorporating the Background by reference herein, the
parties hereto, intending to be legally bound hereby, agree as follows:
ARTICLE I
EFFECT OF SECOND AMENDMENT; ACKNOWLEDGMENTS
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Section 1.01. EFFECT OF SECOND AMENDMENT. This Second Amendment and
the other agreements, instruments and documents executed in connection with this
Second Amendment (collectively, the "Second Amendment Documents") are intended
to amend the Credit Agreement and the other Credit Documents as they are in
effect immediately prior to the date hereof.
Section 1.02. ACKNOWLEDGMENTS. To induce the Administrative Agent
and the Lenders to enter into this Second Amendment, each Credit Party
acknowledges, agrees, warrants, and represents that:
A. Acknowledgment of Specified Default; Loans; Collateral; Waiver of
Claims. (1) the Specified Default currently exists, has not been cured and
constitutes an Event of Default under Section 7.1(c)(i) of the Credit Agreement;
(2) the Administrative Agent and the Lenders are presently entitled, to the
extent provided in Section 7.2 of the Credit Agreement, to accelerate the Credit
Party Obligations and exercise their rights and remedies under the Credit
Documents and applicable law; (3) all outstanding principal, accrued interest
and all other amounts recoverable under the Loans, if accelerated by the
Administrative Agent and the Lenders in accordance with the Credit Agreement,
would now be due and owing to the Lenders by the Credit Parties; (4) the Credit
Documents are valid and enforceable against, and all of the terms and conditions
of the Credit Documents are binding on, each Credit Party, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar law affecting the enforcement of
creditors' rights generally or by general equitable principles (whether
enforcement is sought by proceedings in equity or at law); (5) the liens and
security interests granted by the Credit Parties to the Administrative Agent on
behalf of the Lenders pursuant to the Credit Documents are valid, legal and
binding and properly recorded or filed and perfected first priority security
interests (except as otherwise provided in Section 3.23 of the Credit Agreement,
Section 4(d) of the Security Agreement or the corresponding provision in any
other Security Document); and (6) the Credit Parties hereby waive any and all
defenses, set-offs and counterclaims which any of them may have or claim to have
against the Administrative Agent, the Lenders or the Credit Party Obligations as
of the date hereof on account of the credit facility established under the
Credit Documents.
B. Acknowledgment of Liabilities. As of May 7, 2003, the following
principal amounts (inclusive of the face amounts of undrawn Letters of Credit)
are owing to the Lenders under the Credit Documents (in addition to accrued
interest and all other sums payable under the Credit Documents):
Principal
Revolving Notes (Face Amounts of Letters of Credit) $ 1,171,710.81
Tranche A Term Notes $ 35,999,999.99
Delayed Draw Term Notes $ 8,000,000.00
Swingline Notes $ -0-
C. Adequate Representation. Each Credit Party has been represented
by legal counsel of its choice and is fully aware of the terms contained in this
Second Amendment and has voluntarily, without coercion or duress of any kind,
entered into this Second Amendment and the documents executed in connection with
this Second Amendment.
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ARTICLE II
WAIVER OF SPECIFIED DEFAULT
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Section 2.01. WAIVER OF SPECIFIED DEFAULT. The Administrative Agent
and the Lenders hereby waive the Specified Default. Notwithstanding the
foregoing, neither the Administrative Agent and the Lenders' waiver of the
Specified Default nor any communication between the Administrative Agent, the
Lenders, the Credit Parties or any party's respective officers, agents,
employees or representatives shall be deemed to constitute a waiver of (i) any
Event of Default existing under the Credit Documents, whether now existing or
hereafter arising under the Credit Documents, other than the Specified Default;
(ii) the ongoing obligations of the Credit Parties to comply with the Credit
Agreement and the other Credit Documents as amended hereby; or (iii) any rights
or remedies which the Administrative Agent and the Lenders have against the
Credit Parties under the Credit Agreement, the other Credit Documents and/or
applicable law, with respect to Events of Default, other than rights and
remedies which directly result from the occurrence and existence of the
Specified Default. The Administrative Agent and the Lenders hereby reserve and
preserve all of their rights and remedies against the Credit Parties under the
Credit Agreement and other Credit Documents and under applicable law, other than
the right to declare an Event of Default or exercise remedies based upon the
occurrence and existence of the Specified Default, including, without
limitation, the right to declare an Event of Default and exercise remedies
should an Event of Default presently exist which has not been disclosed to the
Administrative Agent and the Lenders by the Credit Parties and which is not part
of the defined "Specified Default" or should an Event of Default occur after the
date of this Second Amendment (including any Events of Default that may occur
based upon violations after the date hereof of the sections of the Credit
Agreement which were violated in connection with the Specified Default).
ARTICLE III
AMENDMENTS
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Section 3.01. Notwithstanding anything to the contrary contained in
the Credit Agreement or the other Credit Documents (but subject to the provisos
set forth in the defined term "Interest Period") on and after the Second
Amendment Closing Date, Interest Periods for LIBOR Rate Loans shall be limited
to Interest Periods of one month.
Section 3.02. The following new definitions are hereby added to
Article I of the Credit Agreement in appropriate alphabetical order:
"Account" shall have the meaning given to that term in the Uniform
Commercial Code now or hereafter in effect in the State of North
Carolina, and, in addition, shall include any right to payment for
goods sold or leased or services rendered which is evidenced by an
instrument or chattel paper.
"Borrowing Base" means, as at any date, the sum of 75% of the
outstanding amount of the Eligible Accounts of the Credit Parties.
"Consolidated EBITDAR" shall equal: (x) Consolidated EBITDA; plus
(y) actual restructuring expenses incurred by the Credit Parties,
not to exceed the following amounts during the following periods:
3
Maximum
Restructuring
Period Expenses
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January 1, 2003 - March 31, 2003 $1,948,000
April 1, 2003 - June 30, 2003 $1,800,000
April 1, 2003 - September 30, 2003 $3,221,000
April 1, 2003 - December 31, 2003 $4,677,000
April 1, 2003 - March 31, 2004 $6,280,000
July 1, 2003 - June 30, 2004 $6,266,000
October 1, 2003 - September 30, 2004 $7,100,000
January 1, 2004 - December 31, 2004 $7,500,000
"Eligible Account" shall mean each Account which meets all of the
following criteria:
(a) The Account arose from a bona fide outright sale of goods by a
Credit Party, or for services performed by a Credit Party, under an
enforceable contract, to or for a Person located within the United
States (or a Person located elsewhere if accompanied by an
irrevocable letter of credit reasonably acceptable to the
Administrative Agent issued in favor of a Credit Party at the
request of such Person), and such goods have been shipped to or at
the direction of the appropriate account debtor, or the sale has
otherwise been consummated, or the services have been performed for
the appropriate account debtor in accordance with such contract;
(b) The title of the Credit Party to the Account, and, except as to
the account debtor, to any goods to be sold or leased in connection
with the Account, is absolute and is not subject to any prior
assignment or encumbrance (other than in favor of the Administrative
Agent and the Lenders, and any Affiliate of the Administrative Agent
or any Lender under any Hedging Agreement);
(c) The amount of the Account shown on the books of the Credit Party
and on any invoice or statement delivered to the Administrative
Agent is owing to the Credit Party and no partial payment has been
made thereon by any Person;
(d) The Account is not a contra account and is not subject to any
claim of reduction, counterclaim, set-off, recoupment, or any claim
for credits, allowances or adjustments by the account debtor because
of returned, inferior or damaged goods or unsatisfactory services,
or for any other reason, except for customary discounts allowed for
prompt payment;
(e) The Account is not an account that the Administrative Agent, in
its discretion, has reasonably and in good faith determined does not
constitute an Eligible Account in whole or in part, as described in
a notice of such determination given by the Administrative Agent to
the Borrower;
(f) The account debtor has not returned or refused to accept or
retain any of the goods or services from the sale or furnishing of
which the Account arose;
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(g) The Account is due and payable not more than sixty (60) days
from the date of the invoice therefor;
(h) The age of the Account, calculated from the date of the invoice
therefor, is not more than ninety (90) days;
(i) Not more than fifty percent (50%) of all Accounts payable to the
Credit Party by the account debtor are older than ninety (90) days
from the invoice date;
(j) The Account does not arise out of a contract with, or order
from, an account debtor that, by its terms, forbids or makes the
assignment of that Account to the Administrative Agent void or
unenforceable;
(k) The Account is not an account with respect to which the account
debtor is the United States or any state or political subdivision
thereof or any department, agency or instrumentality of the United
States, any state or political subdivision, unless there has been
compliance with the federal Assignment of Claims Act or any similar
state or local law, if applicable;
(l) If the Credit Party has received any note, trade acceptance,
draft or other instrument or chattel paper with respect to or in
payment of the Account, the Credit Party has immediately notified
the Administrative Agent and, at the latter's request, endorsed or
assigned and delivered the same to the Administrative Agent;
(m) The Credit Party has not received any notice of the dissolution,
termination of existence, insolvency, business failure, appointment
of a receiver for any part of the property of, assignment for the
benefit of creditors by, or the filing of a petition in bankruptcy
or the commencement of any proceeding under any bankruptcy or
insolvency laws by or against the account debtor; and
(n) The account debtor is not an Affiliate of any Credit Party.
"Permitted Sale-Leasebacks" shall have the meaning ascribed to such
term in Section 6.11.
"Second Amendment" shall mean that certain Waiver and Second
Amendment to Credit Agreement dated as of the Second Amendment
Closing Date.
"Second Amendment Closing Date" shall mean May 9, 2003.
Section 3.03. The following definitions contained in Article I of
the Credit Agreement are hereby amended and restated in their entirety to read
as follows:
"Applicable Percentage" shall mean, for any day, the rate per annum
set forth below opposite the applicable level then in effect, it
being understood that the Applicable Percentage for (i) Loans that
are Alternate Base Rate Loans shall be the percentage set forth
under the column "Alternate Base Rate Margin for Loans", (ii) Loans
that
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are LIBOR Rate Loans shall be the percentage set forth under the
column "LIBOR Rate Margin for Loans and Letter of Credit Fee", (iii)
the Letter of Credit Fee shall be the percentage set forth under the
column "LIBOR Rate Margin for Loans and Letter of Credit Fee", and
(iv) the Commitment Fee shall be the percentage set forth under the
column "Commitment Fee":
LIBOR Rate Alternate
Margin for Base Rate
Leverage Loans and Letter of Margin for Commitment
Level Ratio Credit Fee Loans Fee
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I > 2.50 to 1.0 3.50% 1.75% 1.00%
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II > 2.25 to 1.0 3.25% 1.50% 1.00%
but
< 2.50 to 1.0
-
- ----------------------------------------------------------------------------------------------------------------
III >2.00 to 1.0 but 3.00% 1.25% 1.00%
but
< 2.25 to 1.0
-
- ----------------------------------------------------------------------------------------------------------------
IV > 1.75 to 1.0 but 2.75% 1.00% 0.875%
but
< 2.00 to 1.0
-
- ----------------------------------------------------------------------------------------------------------------
V > 1.50 to 1.0 but 2.50% 0.75% 0.875%
but
< 1.75 to 1.0
-
- ----------------------------------------------------------------------------------------------------------------
VI < 1.50 to 1.0 2.25% 0.50% 0.875%
-
- ----------------------------------------------------------------------------------------------------------------
The Applicable Percentage shall, in each case, be determined and
adjusted quarterly on the date five (5) Business Days after the date
on which the Administrative Agent has received from the Borrower the
financial information and certifications required to be delivered to
the Administrative Agent and the Lenders in accordance with the
provisions of Sections 5.1(a) and (b) and Section 5.2(b) (each an
"Interest Determination Date"). Such Applicable Percentage shall be
effective from such Interest Determination Date until the next such
Interest Determination Date. Commencing on March 31, 2003, Level I
Applicable Percentages shall be in effect. Level I Applicable
Percentages shall remain in effect until the earlier of June 30,
2004 or such time as the Borrower shall have delivered an officer's
compliance certificate pursuant to Section 5.2(b) indicating that
the Fixed Charge Coverage Ratio exceeds 1.25:1.0. Thereafter,
Applicable Percentages shall be based on the Leverage Ratio set
forth in the officer's compliance certificates delivered pursuant to
Section 5.2(b). If the Borrower shall fail to provide the annual or
quarterly financial information and certifications in accordance
with the provisions of Sections 5.1(a) and (b) and Section 5.2(b),
the Applicable Percentage from such Interest Determination Date
shall, on the date five (5) Business Days after the date by which
the Borrower was so required to provide such financial information
and certifications to the Administrative Agent and the Lenders, be
based on Level I until such time as such information and
certifications are provided, whereupon the Level shall be determined
based upon the Leverage Ratio as of the fiscal quarter end to which
such financial information and certifications relate.
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"Consolidated Capital Expenditures" shall mean, for any period, all
capital expenditures of the Parent and its Subsidiaries on a
consolidated basis for such period, as determined in accordance with
GAAP. The term "Consolidated Capital Expenditures" shall not include
capital expenditures in respect of the reinvestment of proceeds
derived from Recovery Events received by the Parent and its
Subsidiaries to the extent that such reinvestment is permitted under
the Credit Documents.
"Consolidated EBITDA" shall mean, for any period, the sum of (a)
Consolidated Net Income for such period, plus (b) an amount which,
in the determination of Consolidated Net Income for such period, has
been deducted for (i) Consolidated Interest Expense (provided, that
for the fiscal quarters ending on or about June 30, 2002, September,
30, 2002 and December 31, 2002 such calculations shall be based on
historical interest expense and not annualized as set forth in the
definition thereof), (ii) total federal, state, local and foreign
income taxes, (iii) depreciation and amortization expense, (iv)
non-cash losses and non-cash charges in an aggregate amount not to
exceed $1,000,000 for any twelve-month period unless otherwise
approved in writing by the Required Lenders (provided, however, that
all non-cash losses related to goodwill (or other intangibles)
impairment charges recognized by the Credit Parties shall be
included, notwithstanding the $1,000,000 add-back limitation set
forth above) and (v) for determinations utilizing the fiscal
quarters ending on or about June 30, 2002, September 30, 2002 and
December 31, 2002, the add-backs set forth on Schedule 1.1-5
attached hereto, minus (c) all cash payments made during such period
on account of reserves, restructuring charges and other non-cash
charges added back to Consolidated EBITDA pursuant to subclause
(b)(iv) above in a previous period, all as determined in accordance
with GAAP and in the case of each of the foregoing to the extent
taken into account in the calculation of Consolidated Net Income for
such period.
"Interest Payment Date" shall mean (a) as to any Alternate Base Rate
Loan or Swingline Loan, the last Business Day of each month and on
the applicable Maturity Date, (b) as to any LIBOR Rate Loan, the
last day of such Interest Period and (c) as to any Loan which is the
subject of a mandatory prepayment required pursuant to Section
2.8(b) hereof, the date of such prepayment.
"Permitted Acquisition" shall mean: (i) any acquisition or any
series of related acquisitions by a Credit Party of the assets or a
majority of the Voting Stock of a Person that is incorporated,
formed or organized in the United States, or any division, line of
business or other business unit of a Person that is incorporated,
formed or organized in the United States (such Person or such
division, line of business or other business unit of such Person
referred to herein as the "Target"), in each case that is a type of
business (or assets used in a type of business) permitted to be
engaged in by the Credit Parties and their Subsidiaries pursuant to
Section 6.3 hereof, (which acquisition may include the acquisition
of a foreign entity to the extent that foreign entity is a
Subsidiary of the Target), so long as (a) no Default or Event of
Default shall then exist or would exist after giving effect
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thereto, (b) the Credit Parties shall demonstrate to the reasonable
satisfaction of the Administrative Agent and the Required Lenders
that the Credit Parties will be in compliance on a Pro Forma Basis
with all of the terms and provisions of the financial covenants set
forth in Section 5.9, (c) the Administrative Agent, on behalf of the
Lenders, shall have received (or shall receive in connection with
the closing of such acquisition), to the extent provided in the
Security Documents, a first priority perfected security interest in
all property (including, without limitation, Capital Stock) acquired
with respect to the Target and the Target, if a Person, shall have
executed a Joinder Agreement in accordance with the terms of Section
5.10, (d) the Target has earnings before interest, taxes,
depreciation and amortization for the most recent four fiscal
quarters prior to the acquisition date for which financial
statements are available in an amount greater than $0, (e) such
acquisition is not a "hostile" acquisition and has been approved by
the Board of Directors and/or shareholders of the applicable Credit
Party and the Target, (f) after giving effect to the acquisition,
there shall be at least $10,000,000 of borrowing availability under
the Aggregate Revolving Committed Amount, (g) the Administrative
Agent shall have received a certificate from a Responsible Officer
of the Borrower certifying that, in the reasonable judgment of the
Borrower, the Credit Parties have conducted such financial, legal,
environmental and consulting due diligence with respect to the
Target as a substantially similarly situated prudent purchaser
acquiring substantially similar property and/or assets would
customarily conduct and (h) for each acquisition, total
consideration (including, without limitation, assumed Indebtedness,
earnout payments and any other deferred payment) for the net assets,
Capital Stock, division, line of business or other business unit
acquired in such acquisition or series of related acquisitions shall
not exceed (x) for any individual acquisition (or series of related
acquisitions) (A) $5,000,000 in cash (including proceeds of Loans),
deferred payments (including earnout obligations) and the assumption
of Indebtedness and (B) $10,000,000 in aggregate consideration
(including Capital Stock of the Parent) and (y) in the aggregate for
all acquisitions during any fiscal year, (A) $10,000,000 in cash
(including proceeds of Loans), deferred payments (including earnout
obligations) and the assumption of Indebtedness and (B) $20,000,000
in aggregate consideration (including Capital Stock of the Parent);
and (ii) any other acquisition approved by the Required Lenders. For
purposes of determining "total consideration" under subclause (h) of
clause (i) above, the amount of any earnout payment or other
contingent payment shall be considered the maximum amount of such
earnout payment or contingent payment assuming all requirements or
contingencies to the making of such payment have been satisfied or
are no longer applicable. Notwithstanding the foregoing, after the
Second Amendment Closing Date: (x) there shall be no Permitted
Acquisitions prior to June 30, 2005 and (y) cumulative Permitted
Acquisitions after the Second Amendment Closing Date shall not
exceed $3,000,000 in aggregate consideration (unless otherwise
consented to by the Required Lenders).
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Section 3.04. Section 2.1(a) of the Credit Agreement is amended and
restated in its entirety to read as follows:
(a) Revolving Commitment. During the Commitment Period, subject to
the terms and conditions hereof, the Revolving Lenders severally in
accordance with their Revolving Commitment Percentages, but not
jointly, agree to make revolving credit loans ("Revolving Loans") to
the Borrower from time to time in an aggregate principal amount of
up to FIFTEEN MILLION DOLLARS ($15,000,000) (as such aggregate
maximum amount may be increased as provided in Section 2.5 or
reduced from time to time as provided in Section 2.7, the "Aggregate
Revolving Committed Amount") for the purposes hereinafter set forth;
provided, however, that (i) with regard to each Revolving Lender
individually, the sum of such Revolving Lender's Revolving
Commitment Percentage of outstanding Revolving Loans plus such
Revolving Lender's Revolving Commitment Percentage of outstanding
Swingline Loans plus such Revolving Lender's LOC Commitment
Percentage of LOC Obligations shall not exceed the lesser of: (x)
such Revolving Lender's Revolving Committed Amount and (y) such
Revolving Lender's Revolving Commitment Percentage multiplied by the
Borrowing Base, and (ii) with regard to the Revolving Lenders
collectively, the sum of the outstanding Revolving Loans plus
outstanding Swingline Loans plus LOC Obligations shall not exceed
the lesser of: (x) the Aggregate Revolving Committed Amount; and (y)
the Borrowing Base and (iii) no Revolving Loans may be borrowed on
the Closing Date; provided further, however, that until such time
after the Second Amendment Closing Date as the Credit Parties' Fixed
Charge Coverage Ratio (calculated based upon the financial
statements delivered pursuant to Section 5.1 hereof) equals or
exceeds 1.25:1.0: (i) with regard to each Revolving Lender
individually, the sum of such Revolving Lender's Revolving
Commitment Percentage of outstanding Revolving Loans plus such
Revolving Lender's Revolving Commitment Percentage of outstanding
Swingline Loans plus such Revolving Lender's LOC Commitment
Percentage of LOC Obligations shall not exceed the lesser of: (x)
such Revolving Lender's Revolving Commitment Percentage multiplied
by $12,500,000 and (y) such Revolving Lender's Revolving Commitment
Percentage multiplied by the Borrowing Base, and (ii) with regard to
the Revolving Lenders collectively, the sum of the outstanding
Revolving Loans plus outstanding Swingline Loans plus LOC
Obligations shall not exceed the lesser of: (x) $12,500,000; and (y)
the Borrowing Base. Revolving Loans may consist of Alternate Base
Rate Loans or LIBOR Rate Loans, or a combination thereof, as the
Borrower may request, and may be repaid and reborrowed in accordance
with the provisions hereof. LIBOR Rate Loans shall be made by each
Revolving Lender at its LIBOR Lending Office and Alternate Base Rate
Loans at its Domestic Lending Office.
Section 3.05. Sections 2.8(b)(ii) and 2.8(b)(v) of the Credit
Agreement are amended and restated in their entirety to read as follows:
(ii) Asset Dispositions. Promptly following any Asset Disposition,
the Borrower shall prepay the Loans and cash collateralize the LOC
Obligations in an aggregate amount equal to the Net Cash Proceeds
derived from such Asset Disposition (such prepayment to be applied
as set forth in clause (vi) below); provided, however, that such Net
Cash Proceeds in an aggregate amount during the term of this
Agreement not to exceed $2,000,000 shall not be required to be so
applied to the extent the Borrower delivers to the Administrative
Agent promptly following any such Asset Disposition a certificate
stating that the Credit Parties intend to use such Net Cash Proceeds
to acquire fixed or capital assets used in the Credit Parties'
business within 180 days of the receipt of such Net Cash Proceeds,
it being expressly agreed that any
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Net Cash Proceeds not so reinvested shall be applied to prepay the
Loans and cash collateralize the LOC Obligations immediately
thereafter (such prepayment to be applied as set forth in clause
(vi) below); and provided further, however, that this clause (ii)
shall not apply to the proceeds of Permitted Sale-Leasebacks.
(v) Excess Cash Flow. Within 90 days after the end of each fiscal
year (commencing with the fiscal year ending June 30, 2004), the
Borrower shall prepay the Loans and cash collateralize the LOC
Obligations in an amount equal to: (i) 75% of the Excess Cash Flow
earned during such prior fiscal year (such prepayments to be applied
as set forth in clause (vi) below), if the Fixed Charge Coverage
Ratio is less than 1.25 to 1.00 as of the end of the fiscal year for
which Excess Cash Flow is then being calculated; (ii) 50% of the
Excess Cash Flow earned during such prior fiscal year (such
prepayments to be applied as set forth in clause (vi) below), if the
Fixed Charge Coverage Ratio is greater than or equal to 1.25 to
1.00, but less than 1.50 to 1.00 as of the end of the fiscal year
for which Excess Cash Flow is then being calculated; and (iii) 0% of
the Excess Cash Flow earned during such prior fiscal year, if the
Fixed Charge Coverage Ratio is greater than or equal to 1.50 to 1.00
as of the end of the fiscal year for which Excess Cash Flow is then
being calculated.
Section 3.06. Section 5.1(b) of the Credit Agreement is amended and
restated in its entirety to read as follows:
(b) Quarterly Financial Statements. As soon as available and in any
event within (i) sixty (60) days after the end of each fiscal year,
a company prepared consolidated and consolidating balance sheet of
the Parent and its consolidated Subsidiaries as at the end of such
period and related company-prepared consolidated and consolidating
statements of operations, stockholders' equity and of cash flows for
the Parent and its consolidated Subsidiaries for such quarterly
period and for the portion of the fiscal year ending with such
period and (ii) forty-five (45) days after the end of the first
three fiscal quarters of each fiscal year of the Parent, a
company-prepared consolidated and consolidating balance sheet of the
Parent and its consolidated Subsidiaries as at the end of such
period and related company-prepared consolidated and consolidating
statements of operations, stockholders' equity and of cash flows for
the Parent and its consolidated Subsidiaries for such quarterly
period and for the portion of the fiscal year ending with such
period, in each case setting forth in comparative form consolidated
and consolidating figures for the corresponding period or periods of
the preceding fiscal year (subject to normal recurring year-end
audit adjustments) and (other than in the case of the statements
delivered pursuant to clause (i)) including management discussion
and analysis of operating results inclusive of operating metrics in
comparative form and a summary of accounts receivable and accounts
payable aging reports in form reasonably satisfactory to the
Lenders;
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Section 3.07. Section 5.1 of the Credit Agreement is supplemented by
adding the following Sections 5.1(e) and (f):
(e) Borrowing Base Certificates. Within twenty days of the end of
any calendar month in which Revolving Loans exceed $5,000,000 for
more than ten (10) days (or in any other month in which the
Administrative Agent requests delivery in its reasonable
discretion), a borrowing base certificate as of the end of the
preceding month in the form set forth on Schedule 3.07 to the Second
Amendment.
(f) Restructuring Status Report. Simultaneously with the delivery of
the financial statements described in Section 5.1(b), a
restructuring status report in form and substance reasonably
acceptable to the Administrative Agent and the Lenders, which report
shall include, without limitation, comparisons of the following
items to plan: (i) plant utilization; (ii) restructuring expenses;
(iii) timing of restructuring initiatives; (iv) product transfers;
(v) revenue attrition; and (vi) expense reduction realization.
Section 3.08. Section 5.6 of the Credit Agreement is amended and
restated in its entirety to read as follows:
5.6 Inspection of Property; Books and Records; Discussions. Keep
proper books of records and account in which full, true and correct
entries in conformity with GAAP and all Requirements of Law shall be
made of all dealings and transactions in relation to its businesses
and activities; and permit, during regular business hours and upon
reasonable notice by the Administrative Agent or any Lender, the
Administrative Agent, any Lender and/or their respective officers,
agents and designees to visit and inspect any of its properties and
examine and make abstracts from any of its books and records (other
than materials protected by the attorney-client privilege and
materials which a Credit Party or a Subsidiary thereof may not
disclose without violation of a confidentiality obligation binding
upon it) at any reasonable time and as often as may reasonably be
desired, and to discuss the business, operations, properties and
financial and other condition of the Credit Parties and their
Subsidiaries with officers and employees of the Credit Parties and
their Subsidiaries and with its independent certified public
accountants, in each case at the Borrower's reasonable expense.
Without limiting the absolute right of the Administrative Agent and
the Lenders (and their respective agents and designees) to visit and
inspect the Credit Parties' properties and examine the Credit
Parties' books and records, the Credit Parties acknowledge and agree
a field audit will be performed if Revolving Loans exceed $5,000,000
for more than ten (10) days in any calendar month.
Section 3.09. Sections 5.9(a), (b) and (d) of the Credit Agreement
are amended and restated in their entirety to read as follows:
(a) Leverage Ratio. The Leverage Ratio, as of the last day of each
fiscal quarter of the Parent during the periods indicated below,
shall be less than or equal to the following:
11
Date Ratio
---- -----
June 30, 2003 2.75:1.00
September 30, 2003 2.80:1.00
December 31, 2003 3.15:1.00
March 31, 2004 2.60:1.00
June 30, 2004 2.30:1.00
September 30, 2004 2.00:1.00
December 31, 2004 1.75:1.00
March 31, 2005 (and each fiscal
quarter ending thereafter) 1.50:1.00
(b) Fixed Charge Coverage Ratio. The Fixed Charge Coverage Ratio, as
of the last day of each fiscal quarter of the Parent during the
periods indicated below, shall be greater than or equal to the
following:
Period Ratio
------ -----
June 30, 2003 0.45:1.00
September 30, 2003 0.30:1.00
December 31, 2003 0.40:1.00
March 31, 2004 0.75:1.00
June 30, 2004 0.70:1.00
September 30, 2004 0.65:1.00
December 31, 2004 0.75:1.00
March 31, 2005 0.90:1.00
June 30, 2005 1.05:1.00
September 30, 2005 1.30:1.00
December 31, 2005 (and each
fiscal quarter ending thereafter) 1.50:1.00
(d) Consolidated Capital Expenditures. Consolidated Capital
Expenditures as of the end of each fiscal year of the Parent
indicated below shall be less than or equal to the following:
Fiscal Year Amount
----------- ------
2003 $13,000,000
2004 $10,000,000
2005 $ 9,000,000
2006 $10,000,000
2007 $15,000,000
provided, however, that the following additional Consolidated
Capital Expenditures shall be allowed in the fiscal year of the
Parent indicated below, provided that such additional Consolidated
Capital Expenditures are financed solely by means of Capital Leases
or additionally incurred Indebtedness (provided the incurrence of
such Capital Leases and/or additional incurred Indebtedness would
not otherwise violate this Agreement):
12
Fiscal Year Amount
----------- ------
2003 $ -0-
2004 $2,500,000
2005 $3,500,000
2006 $3,000,000
2007 $ -0-
Section 3.10. Section 5.9 of the Credit Agreement is supplemented by
adding the following Section 5.9(e):
(e) Minimum Quarterly Consolidated EBITDAR. Consolidated EBITDAR, as
of the last day of each period of the Parent during the periods
indicated below, shall be greater than or equal to the following:
Period Amount
------ ------
January 1, 2003 - March 31, 2003 $ 4,400,000
April 1, 2003 - June 30, 2003 $ 5,000,000
April 1, 2003 - September 30, 2003 $ 9,800,000
April 1, 2003 - December 31, 2003 $15,300,000
April 1, 2003 - March 31, 2004 $21,400,000
July 1, 2003 - June 30, 2004 $22,000,000
October 1, 2003 - September 30, 2004 $23,800,000
January 1, 2004 - December 31, 2004 $25,300,000
Section 3.11. Article V of the Credit Agreement is supplemented by
adding the following Sections 5.16 through 5.18:
5.16 Deposit Accounts. Use the Administrative Agent and the Lenders
as their sole depository institutions for all operating accounts
(other than petty cash accounts) and execute control agreements with
respect to the same, to the extent required by the Administrative
Agent.
5.17 Control Agreements. For any securities, investment or other
accounts not maintained with the Administrative Agent or the
Lenders, deliver to the Administrative Agent a control agreement
reasonably acceptable to the Administrative Agent, executed by the
applicable Credit Party and the financial institution maintaining
such accounts, pursuant to which the Administrative Agent, for the
benefit of the Lenders, shall be deemed to have "control" (as
contemplated in Sections 8-106 and/or 9-104 (as applicable) of the
Uniform Commercial Code) of such accounts.
5.18 Compliance With Restructuring Plan. Comply in all material
respects with the restructuring plan formulated by the Credit
Parties and delivered to the Administrative Agent and the Lenders in
April 2003. In the event that the Administrative Agent and the
Required Lenders shall determine that the effects of the Credit
Parties' restructuring plan materially detrimentally differ from the
anticipated restructuring effects or that the Credit Parties have
failed to achieve the
13
anticipated benefits of such restructuring plan, then at the request
of the Administrative Agent, the Credit Parties shall retain a
turnaround/workout consultant or restructuring officer acceptable to
the Administrative Agent.
Section 3.12. Section 6.1(c) of the Credit Agreement is amended and
restated in its entirety to read as follows:
(c) Indebtedness of the Borrower and its Subsidiaries incurred after
the Closing Date consisting of Capital Leases or Indebtedness
incurred to provide all or a portion of the purchase price or cost
of construction of an asset (including all Indebtedness incurred in
connection with Permitted Sale-Leasebacks) provided that (i) such
Indebtedness when incurred shall not exceed the purchase price or
cost of construction of such asset; (ii) no such Indebtedness shall
be refinanced for a principal amount in excess of the principal
balance outstanding thereon at the time of such refinancing; and
(iii) the total amount of all such Indebtedness (x) incurred in any
fiscal year shall not exceed $4,000,000 and (y) outstanding at any
time shall not exceed $10,000,000 in the aggregate; provided,
however, that sale proceeds received in connection with Permitted
Sale-Leasebacks involving Operating Leases shall reduce the
$4,000,000 and $10,000,000 limitations set forth above on a
dollar-for-dollar basis.
Section 3.13. Section 6.4 of the Credit Agreement is amended by
deleting the word "and" appearing at the end of clause (ix), inserting that word
at the end of clause (x) and adding the following new clause (xi):
(xi) Permitted Sale-Leasebacks;
Section 3.14. Section 6.11 of the Credit Agreement is amended and
restated in its entirety to read as follows:
Section 6.11 Sale Leasebacks.
---------------
No Credit Party will, nor will it permit any Subsidiary, directly or
indirectly, to become or remain liable as lessee or as guarantor or
other surety with respect to any lease, whether an Operating Lease
or a Capital Lease, of any property (whether real, personal or
mixed), whether now owned or hereafter acquired, (a) which any
Credit Party or any Subsidiary has sold or transferred or is to sell
or transfer to a Person which is not another Credit Party or
Subsidiary or (b) which any Credit Party or any Subsidiary intends
to use for substantially the same purpose as any other property
which has been sold or is to be sold or transferred by such Credit
Party or such Subsidiary to another Person which is not another
Credit Party or Subsidiary in connection with such lease; provided,
however, that it shall not be a violation of this Section 6.11 for
one or more Credit Parties or Subsidiaries directly or indirectly
become or remain liable as lessee or as guarantor or other surety
with respect to any lease, whether an Operating Lease or a Capital
Lease, of any property (whether real, personal or mixed), whether
now owned or hereafter acquired which any Credit Party or any
Subsidiary has sold or transferred or is to sell or transfer to a
Person which is not another Credit Party or Subsidiary,
14
provided that such sale and agreement to become or remain liable
occurs on or prior to December 31, 2003 and is in respect of real or
personal property acquired within 180 days of such sale and
agreement to become or remain liable and the cumulative proceeds
received by such Credit Parties or Subsidiaries does not exceed
$4,000,000 (the sales or other transfers authorized hereby shall be
referred to in this Agreement as "Permitted Sale-Leasebacks").
Section 3.15. Section 7.1(c) of the Credit Agreement is amended and
restated in its entirety to read as follows:
(c) (i) Any Credit Party shall fail to perform, comply with or
observe any term, covenant or agreement applicable to it contained
in Section 5.4, Section 5.7(a), Section 5.9 or Article VI hereof; or
(ii) any Credit Party shall fail to comply with any other covenant,
contained in this Credit Agreement or the other Credit Documents or
any other agreement, document or instrument among any Credit Party,
the Administrative Agent and the Lenders or executed by any Credit
Party in favor of the Administrative Agent or the Lenders (other
than as described in Sections 7.1(a), 7.1(b) or 7.1(c)(i) above),
and in the event such breach or failure to comply is capable of
cure, is not cured within fifteen (15) days of its occurrence; or
Section 3.16. Section 7.2 of the Credit Agreement is amended and
restated in its entirety to read as follows:
Section 7.2 Acceleration; Remedies. Upon the occurrence of an Event
of Default, then, and in any such event, (a) if such event is an
Event of Default specified in Section 7.1(e) above, automatically
the Commitments shall immediately terminate and the Loans (with
accrued interest thereon), and all other amounts under the Credit
Documents (including without limitation the maximum amount of all
contingent liabilities under Letters of Credit) shall immediately
become due and payable, and (b) if such event is any other Event of
Default, any or all of the following actions may be taken: (i) with
the written consent of the Required Lenders, the Administrative
Agent may, or upon the written request of the Required Lenders, the
Administrative Agent shall, by notice to the Borrower declare the
Commitments to be terminated forthwith, whereupon the Commitments
shall immediately terminate; (ii) the Administrative Agent may, or
upon the written request of the Required Lenders, the Administrative
Agent shall, by notice of default to the Borrower, declare the Loans
(with accrued interest thereon) and all other amounts owing under
this Agreement and the Notes to be due and payable forthwith and
direct the Borrower to pay to the Administrative Agent cash
collateral as security for the LOC Obligations for subsequent
drawings under then outstanding Letters of Credit in an amount equal
to the maximum amount of which may be drawn under Letters of Credit
then outstanding, whereupon the same shall immediately become due
and payable; (iii) exercise any rights or remedies of the
Administrative Agent or the Lenders under this Agreement or any
other Credit Document, including, without limitation, any rights or
remedies with respect to the Collateral; (iv) if not previously
requested by the Administrative Agent, then at the request of the
Administrative Agent, the Credit Parties shall retain a
15
turnaround/workout consultant or restructuring officer acceptable to
the Administrative Agent; (v) the Administrative Agent may engage
such appraisers and other professionals as the Administrative Agent
shall deem necessary to inspect and appraise the Credit Parties'
machinery, equipment, real property and other assets, the costs of
such inspections and appraisals to be borne by the Credit Parties;
and (vi) exercise any rights or remedies available to the
Administrative Agent or Lenders under applicable law. To the extent
not prohibited by applicable law which cannot be waived, all of the
rights and remedies of the Administrative Agent and the Lenders
under this Agreement, any other Credit Document or applicable law
shall be cumulative.
Section 3.17. The Revolving Committed Amounts set forth in Schedule
2.1(a) of the Credit Agreement are amended and restated in their entirety to
read as follows:
Revolving Committed
-------------------
Lender Amount
------ ------
Wachovia Bank, National Association $ 3,529,411.80
U.S. Bank National Association 5,294,117.40
Harris Trust and Savings Bank 3,529,411.80
M&I Marshall & Ilsley Bank 2,647,059.00
------------
Total $ 15,000,000.00
Section 3.18. Notwithstanding Section 9.2 of the Credit Agreement,
following the Second Amendment Closing Date, all notices required to be
delivered to the Administrative Agent pursuant to Section 9.2 shall be delivered
to:
The Administrative Wachovia Bank, National Association,
Agent: as Administrative Agent
Charlotte Plaza
201 South College Street, CP-23
Charlotte, North Carolina 28288-0680
Attention: Syndication Agency Services
Telecopier: (704) 383-0288
Telephone: (704) 715-1191
with a copy to:
Wachovia Securities
1339 Chestnut Street
4th Floor, Widener Building
PA4810
Philadelphia, PA 19107
Attention: Joan Anderson, Director
Telecopier: (267) 321-6903
Telephone: (267) 321-6605
16
ARTICLE IV
UNLIMITED GENERAL RELEASE BY THE CREDIT PARTIES
-----------------------------------------------
Each Credit Party, on behalf of itself and any person or entity
claiming by, through or under it (collectively referred to as the "Releasors"),
hereby unconditionally remises, releases and forever discharges the
Administrative Agent, the Syndication Agent, the Documentation Agent and the
Lenders and their respective past and present officers, directors, shareholders,
agents, accountants, auditors, parent corporations, subsidiaries, affiliates,
trustees, administrators, attorneys, predecessors, successors and assigns and,
where applicable, the heirs, executors, administrators, successors and assigns
of any such person or entity, as releasees (collectively referred to as the
"Releasees"), of and from any and all manner of actions, causes of action,
suits, debts, dues, accounts, bonds, covenants, contracts, agreements, promises,
warranties, guaranties, representations, liens, mechanics' liens, judgments,
claims, counterclaims, crossclaims, defenses and/or demands whatsoever,
including, but not limited to, claims for contribution and/or indemnity, whether
now known or unknown, past or present, asserted or unasserted, contingent or
liquidated, at law or in equity, or resulting from any assignment, if any
(collectively referred to as "Claims"), which any of Releasors ever had or now
have against any of the Releasees, for or by reason of any cause, matter or
thing whatsoever, arising from the beginning of time to the date of execution of
this Second Amendment and relating to or arising from the Credit Documents
and/or the lending relationship between the Administrative Agent, the Lenders
and the Credit Parties. Each Credit Party warrants and represents that it has
not assigned, pledged, hypothecated and/or otherwise divested itself and/or
encumbered all or any part of the Claims being released hereby (except in favor
of the Administrative Agent and the Lenders, and any Affiliate of the
Administrative Agent or any Lender under any Hedging Agreement) and that it
agrees to indemnify and hold harmless any and all of Releasees against whom any
Claim so assigned, pledged, hypothecated, divested and/or encumbered is
asserted.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
------------------------------
To induce the Administrative Agent and the Lenders to enter into
this Second Amendment and the other Second Amendment Documents, each Credit
Party makes the following representations and warranties to the Administrative
Agent and the Lenders, each and all of which shall survive the execution and
delivery of this Second Amendment:
Section 5.01. All actions required to be taken by the Credit Parties
and each of their respective officers, directors, members, managers and/or
stockholders for the due authorization, execution, delivery and performance of
this Second Amendment and the other Second Amendment Documents have been taken.
Section 5.02. Each person executing this Second Amendment and the
other Second Amendment Documents on behalf of the Credit Parties is an
authorized representative of such Credit Party and is duly authorized by such
Credit Party to execute same.
17
Section 5.03. This Second Amendment and the other Second Amendment
Documents are the legal, valid and binding obligations of the Credit Parties,
enforceable against the Credit Parties in accordance with their respective
terms, subject only to bankruptcy, insolvency, reorganization, moratorium or
other laws or equitable principles affecting creditors' rights generally.
Section 5.04. The execution, delivery and performance of this Second
Amendment and the other Second Amendment Documents will not violate any
Requirement of Law or any Contractual Obligation under any Material Contract of
the Borrower or any other Credit Party (except those as to which waivers or
consents have been obtained), and will not result in, or require, the creation
or imposition of any Lien on any of its or their respective properties or
revenues pursuant to any Requirement of Law Contractual Obligation other than
the Liens arising under or contemplated in connection with the Credit Documents.
Neither the Borrower nor any other Credit Party is in default under or with
respect to any of its Contractual Obligations in any respect which could
reasonably be expected to have a Material Adverse Effect. No Default or Event of
Default has occurred and is continuing.
Section 5.05. All representations and warranties made by the Credit
Parties in the Credit Documents are true and correct in all material respects as
of the date hereof as if such representations and warranties have been made on
the date hereof.
Section 5.06. Other than the Specified Default, no Default or Event
of Default has occurred and is continuing; and the Credit Parties hereby affirm
and reaffirm to the Administrative Agent and the Lenders all the covenants
contained in the Credit Documents (as amended by the Second Amendment Documents)
respectively applicable to them and agree to abide thereby until all of the
Credit Party Obligations are paid in full.
Section 5.07. All financial statements and other information
previously provided to the Administrative Agent and the Lenders by the Credit
Parties are true and correct in all material respects as of the date thereof.
Section 5.08. Except as previously disclosed to the Administrative
Agent and the Lenders in writing, there are no judgments recorded against any
Credit Party in any jurisdiction and there are no pending or, to its knowledge,
threatened suits or proceedings against it in any jurisdiction.
ARTICLE VI
CONDITIONS PRECEDENT
--------------------
This Second Amendment shall be deemed effective only after the
occurrence of all of the following events:
Section 6.01. DOCUMENTS. The Credit Parties' execution and delivery
to the Administrative Agent and the Lenders (or causing to be executed and
delivered to the Administrative Agent and the Lenders) of the following in form
and substance satisfactory to the Administrative Agent and the Lenders:
A. this Second Amendment duly executed by the Credit Parties;
18
B. a certificate of the appropriate officer of each Credit Party
certifying as to the incumbency and genuineness of the signature of the officer
executing the Second Amendment Documents on behalf of such Credit Party and
certifying that attached thereto is a true, correct and complete copy of (i) the
articles of incorporation, certificate of limited liability company (or
equivalent documents) and all amendments thereto, certified as of a recent date
by the appropriate governmental authority in its jurisdiction of organization,
(ii) the LLC Agreement and all by laws (or equivalent documents), (iii)
resolutions of the Credit Party authorizing the execution, delivery and
performance of this Second Amendment and the other Second Amendment Documents
and (iv) original certificates as of a recent date of the good standing of the
Credit Party under the laws of the jurisdiction of organization;
C. such other agreements, instruments and documents as the
Administrative Agent and the Lenders, in their reasonable discretion, deem
necessary to effectuate this Second Amendment and the other Second Amendment
Documents.
Section 6.02. LOAN PAYMENT. The Borrower shall have paid to the
Administrative Agent, in immediately available funds, a principal payment of
$7,500,000. Notwithstanding anything to the contrary in the Credit Agreement:
(a) the first $2,250,000 paid by the Borrower pursuant to this Section shall be
applied as a prepayment of the first principal payments otherwise payable after
the Second Amendment Closing Date under the Tranche A Term Loan; and (b) all
remaining amounts shall be applied as a pro rata prepayment against all future
Tranche A Term Loan and Delayed Draw Term Loan scheduled principal payments.
Section 6.03. AMENDMENT FEE. The Borrower's payment to the
Administrative Agent, in immediately available funds, of an amendment fee in the
amount equal to 0.25% multiplied by the sum of: (i) the outstanding principal
balance of the Tranche A Term Loan (net of the payment made pursuant to Section
6.02 above); (ii) the outstanding principal balance of the Delayed Draw Term
Loan (net of the payment made pursuant to Section 6.02 above); and (iii)
$15,000,000. The Administrative Agent shall allocate such fee on a pro-rata
basis among such Lenders as shall have executed this Second Amendment on or
before 12:00 p.m. Eastern Time on May 12, 2003.
Section 6.04. OTHER FEES AND EXPENSES. The Borrower's payment to the
Administrative Agent and the Lenders, in immediately available funds, of all
amounts necessary to reimburse the Administrative Agent and the Lenders for the
reasonable fees and costs incurred by the Administrative Agent and the Lenders,
including, without limitation, all reasonable fees and costs incurred by the
Administrative Agent's and the Lenders' attorneys, in connection with the
preparation and execution of this Second Amendment, the other Second Amendment
Documents and any other Credit Document.
ARTICLE VII
MISCELLANEOUS
-------------
Section 7.01. RATIFICATION AND CONFIRMATION. Except as amended and
supplemented by the Second Amendment Documents, all of the terms and provisions
of the Credit Documents, including, without limitation, any waiver of jury trial
contained therein, shall remain
19
in full force and effect and, except as expressly amended by the Second
Amendment Documents, are hereby ratified and confirmed. Each Credit Party hereby
ratifies and confirms that the Credit Documents, as amended by the Second
Amendment Documents, are valid and binding obligations and enforceable in
accordance with their respective terms, except as enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium or similar law
affecting the enforcement of creditors' rights generally or by general equitable
principles (whether enforcement is sought by proceedings in equity or at law).
All Credit Party Obligations of the Credit Parties to the Administrative Agent
and the Lenders presently or hereafter outstanding under the Credit Documents,
as amended by the Second Amendment Documents, shall continue to be secured by
the Collateral and as set forth therein, and this Second Amendment does not
constitute a novation of the Loans from the Lenders to the Borrower. In the
event and to the extent of any conflict between the provisions of this Second
Amendment and the other Second Amendment Documents and the provisions of the
Credit Documents, the provisions of this Second Amendment and the other Second
Amendment Documents shall govern.
Section 7.02. HEADINGS. The headings and underscoring of articles,
sections, clauses and words have been included herein for convenience only and
shall not be considered in interpreting this Second Amendment.
Section 7.03. GOVERNING LAW. This Second Amendment shall be
construed in accordance with and governed by the internal laws of the State of
North Carolina without reference to conflict of laws principles.
Section 7.04. INTEGRATION. The Credit Documents, including this
Second Amendment and the other Second Amendment Documents constitute the sole
agreement of the parties with respect to the subject matter hereof and thereof
and supersede all oral negotiations and prior writings with respect to the
subject matter hereof and thereof.
Section 7.05. FURTHER ACTIONS. Each Credit Party agrees to take such
further action to execute and deliver to each other such additional agreements,
instruments and documents as may reasonably be required to carry out the
purposes of this Second Amendment.
Section 7.06. REMEDIES CUMULATIVE; NO WAIVER. The respective rights,
powers and remedies of the Administrative Agent and the Lenders in this Second
Amendment and in the other Second Amendment Documents are cumulative and not
exclusive of any right, power or remedy provided in the Credit Documents, by law
or equity and no failure or delay on the part of the Administrative Agent and
the Lenders in the exercise of any right, power or remedy shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, power or
remedy preclude any other or further exercise thereof, or the exercise of any
other right, power or remedy.
Section 7.07. AMENDMENT AND WAIVER. No amendment of this Second
Amendment, and no waiver, discharge or termination of any one or more of the
provisions hereof, shall be effective unless set forth in writing and signed by
all of the parties hereto.
Section 7.08. SUCCESSORS AND ASSIGNS. This Second Amendment (i)
shall be binding upon the Lenders, the Administrative Agent and the Credit
Parties, and upon their respective nominees, successors and permitted assigns,
and (ii) shall inure to the
20
benefit of the Administrative Agent, the Lenders and the Credit Parties, and to
their respective nominees, successors and assigns, provided that the Credit
Parties may not assign their rights hereunder or any interest herein without
obtaining the prior written consent of the Administrative Agent and the Lenders,
and any such assignment or attempted assignment shall be void and of no effect
with respect to the Administrative Agent and the Lenders.
Section 7.09. SEVERABILITY OF PROVISIONS. Any provision of this
Second Amendment that is held to be inoperative, unenforceable, void or invalid
in any jurisdiction shall, as to that jurisdiction, be ineffective,
unenforceable, void or invalid without affecting the remaining provisions in
that jurisdiction or the operation, enforceability or validity of that provision
in any other jurisdiction, and to this end the provisions of this Second
Amendment are declared to be severable.
Section 7.10. NO THIRD-PARTY BENEFICIARIES. Notwithstanding anything
to the contrary contained herein, no provision of this Second Amendment and the
other Second Amendment Documents is intended to benefit any party other than the
signatories hereto nor shall any such provision be enforceable by any other
party.
Section 7.11. JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICABLE LAW,
EACH CREDIT PARTY HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR
PROCEEDING ARISING OUT OF THE CREDIT AGREEMENT, THIS SECOND AMENDMENT, THE
SECOND AMENDMENT DOCUMENTS, THE OTHER CREDIT DOCUMENTS, OR ANY OTHER AGREEMENTS
OR TRANSACTIONS RELATED HERETO OR THERETO.
Section 7.12. COUNTERPARTS. This Second Amendment may be executed in
any number of counterparts and by the different parties on separate counterparts
and each such counterpart shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Second Amendment. This
Second Amendment shall be deemed to have been executed and delivered when the
Administrative Agent has received counterparts hereof executed by all parties
listed on the signature pages below.
Section 7.13. EFFECTIVE DATE. This Second Amendment shall be
effective as of the date hereof; provided, however, that the Applicable
Percentages set forth in Section 3.03 of this Second Amendment shall be
effective as of March 31, 2003.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
21
IN WITNESS WHEREOF, the undersigned have caused this Second
Amendment to be executed by their duly authorized officers on the date first
above written.
BORROWER:
--------
MEDSOURCE TECHNOLOGIES, LLC
By: /s/
------------------------------------
Name:
Title:
GUARANTORS:
-----------
MEDSOURCE TECHNOLOGIES, INC.
By: /s/
------------------------------------
Name:
Title:
BRIMFIELD PRECISION, LLC
By: /s/
------------------------------------
Name:
Title:
KELCO ACQUISITION LLC
By: /s/
------------------------------------
Name:
Title:
HAYDEN PRECISION INDUSTRIES, LLC
By: /s/
------------------------------------
Name:
Title:
22
NATIONAL WIRE & STAMPING, INC.
By: /s/
------------------------------------
Name:
Title:
PORTLYN, LLC
By: /s/
------------------------------------
Name:
Title:
TEXCEL, INC.
By: /s/
------------------------------------
Name:
Title:
THE MICROSPRING COMPANY, LLC
By: /s/
------------------------------------
Name:
Title:
TENAX, LLC
By: /s/
------------------------------------
Name:
Title:
23
THERMAT ACQUISITION CORP.
By: /s/
------------------------------------
Name:
Title:
MEDSOURCE TECHNOLOGIES, NEWTON INC.
By: /s/
------------------------------------
Name:
Title:
MEDSOURCE TRENTON, INC.
By: /s/
------------------------------------
Name:
Title:
CYCAM, INC.
By: /s/
------------------------------------
Name:
Title:
ELX, INC.
By: /s/
------------------------------------
Name:
Title:
MEDSOURCE TECHNOLOGIES PITTSBURGH, INC.
By: /s/
------------------------------------
Name:
Title:
24
ADMINISTRATIVE AGENT
AND LENDERS: WACHOVIA BANK, NATIONAL ASSOCIATION,
- ------------
as Administrative Agent and as a Lender
By: /s/
------------------------------------
Name:
Title:
U.S. BANK NATIONAL ASSOCIATION,
as a Lender
By: /s/
------------------------------------
Name:
Title:
HARRIS TRUST AND SAVINGS BANK,
as a Lender
By: /s/
------------------------------------
Name:
Title:
M&I MARSHALL & ILSLEY BANK,
as a Lender
By: /s/
------------------------------------
Name:
Title:
By: /s/
------------------------------------
Name:
Title:
25